Retailers Get Reprieve as Gloom Lifts

NEW YORK (TheStreet) -- This holiday shopping season is one of the most crucial in decades as retailers pull out all the stops to get consumers to spend liberally.

Strong sales could do wonders for the stock market and the economy as investors try to determine if the turnaround is for real or just a bounce before the misery continues. Retailers got a pre-Thanksgiving shot in the arm today as the Conference Board reported that consumer confidence unexpectedly picked up in November.

Even with unemployment rising, consumers have been enticed by bargains at Target(TGT Quote), Wal-Mart(WMT Quote) and Kohl's(KSS Quote), which are spending heavily on TV ads and discounting products steeply to ensure that foot traffic is high over the next month. Super deals like $300 flat-panel TVs would motivate even the stingiest of people. There might just be a mini-miracle this Christmas.

The biggest gains in consumer confidence were found in states along the diagonal line from Florida to North Dakota, while New England and the Mountain region were again among the gloomiest regions. The heartland has been the least affected by economic problems because the housing boom never got out of hand and the oil industry is sustaining many communities. Texas, Oklahoma and Arkansas were the most confident, though confidence has been deteriorating.

Elevated confidence will most likely lead to looser purse strings during the holiday season, which should come as a welcome reprieve for retailers. Best Buy(BBY Quote) could be one of the biggest beneficiaries since flat-panel TVs and other entertainment gear should be hot sellers. Customers may actually be inclined to buy another model up or trade in Wal-Mart for the specialty retailer's expertise.